2203ED, 26.09.14 Model Petroleum Title Farmout Agreement Single Party

8/9/2019 2203ED, 26.09.14 Model Petroleum Title Farmout Agreement Single Party

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Model Petroleum Title Farmout Agreement(Single Party)

EXPLANATORY NOTE

The Board of AMPLA Ltd ACN 006 037 529 has prepared this Exposure Draft Model PetroleumTitle Farmout Agreement (Single Party) ( Model Farmout Agreement ) for use in non-complexoil and gas projects, primarily in the exploration and appraisal phases, following therecommendations of a Reference Group selected from experienced AMPLA members working in

petroleum companies and in private practice.

This Model Farmout Agreement is an agreement which may be used under the law of theCommonwealth or any State or Territory of Australia, including offshore waters. It is intended to

be used in conjunction with the AMPLA Model Petroleum Joint Operating Agreement, or the

AMPLA Model Petroleum Exploration Joint Operating Agreement.The Model Farmout Agreement assumes that the sole holder of the Petroleum Title(s) is farmingout part of its interest. To earn its interest, the Farmee is funding the Farmors costs during theEarning Period and/or carrying out the work itself and/or refunding past expenditure to earn oracquire its interest in the Petroleum Title(s). Stamp duty and/or registration fees may bechargeable which will impact on any transaction, depending on the jurisdiction in which thePetroleum Title is located.

This Model is not intended as a rigid precedent to be adopted without amendment. Rather it is aguide which includes representative and balanced provisions across matters normally covered insuch an agreement. In any particular matter, alternative clauses, such as those relating to earningof an interest in the Petroleum Title, can be inserted in the Model with minimum amendment.

Reference should also be made to the Model Alternative and Optional clauses which can be usedwith, or in substitution for, clauses in this Model.

Note: This Model form document continues to be revised and updated. The AMPLA websiteshould be checked to ensure that you are using the latest version.

RELATED AMPLA MODEL DOCUMENTS

Petroleum Farmout Agreement, Alternative & Optional clauses, Exposure Draft Petroleum Joint Operating Agreement Petroleum Joint Operating Agreement Alternative & Optional clauses Petroleum Exploration Joint Operating Agreement Royalty Deed for use with Sale-Farmin Agreement

COPYRIGHT

This Model Farmout Agreement is the property of AMPLA Ltd which owns the copyright.AMPLA financial members are granted a royalty free licence to use the Model FarmoutAgreement for commercial purposes on the basis set out below. Non-members may use theModel Farmout Agreement on a similar basis only if the applicable licence fee has been paid.

DISCLAIMER

This document is provided for use only by persons engaging in commercial activities.

No person or entity (including, without limitation, AMPLA Limited) associated with thedevelopment of this document makes any representation or warranty regarding the Model

Farmout Agreement, nor is liable for any loss or damage whatsoever that may result from the useof the Model Farmout Agreement or any portion or variation thereof, or any other materials


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presented in conjunction with the Model Farmout Agreement or any errors or omissions in itscontents.

AMPLA LTD. MAKES NO WARRANTY OR GUARANTEE OR PROMISE, EXPRESS ORIMPLIED, THAT THIS MODEL FARMOUT AGREEMENT IS ACCURATE, COMPLETE,VALID AND ENFORCEABLE, UP TO DATE, OR FIT FOR ANY USE WHATSOEVER. ITIS MADE AVAILABLE ON THE AMPLA WEBSITE FOR THE INFORMATION AND USEOF AMPLA MEMBERS AND FOR THE USE OF NON-MEMBERS ON PAYMENT OF THEAPPLICABLE LICENCE FEE AND ON THE CONDITION THAT AMPLA LTD IS NOTENGAGED IN RENDERING PROFESSIONAL ADVICE. READERS OF IT SHOULDEXERCISE THEIR OWN SKILL AND JUDGMENT IN ADOPTING OR ADAPTING ANYPART OF THE MODEL DEED FOR THEIR OWN USE AND, WHERE NECESSARY, SEEKADVICE FROM A SUITABLY QUALIFIED LEGAL PRACTITIONER.

Note for South Africa use : If you acquire, download and/or use an AMPLA Model Document inSouth Africa or for use in respect of a transaction relating to South Africa in any way, youwarrant that you are doing so on behalf of a juristic person whose asset value or annual turnoverequals or exceeds 2 million rand. AMPLA Model Documents are not available to any other

person in, or in connection with, South Africa.

IMPROVEMENTS

If you have any questions or suggestions for improvement concerning this Model FarmoutAgreement, please contact the AMPLA office at [email protected] or see www.ampla.org. Allquestions, comments and other feedback would be appreciated by the AMPLA Board.
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Table of Contents

Particulars 1

1 Definitions and interpretation 1

1.1 Definitions 1 1.2 Interpretation 3

2 Conditions precedent 4

2.1 Coming into effect of agreement 4 2.2 Satisfaction of Conditions Precedent 4 2.3 Failure to satisfy Condition Precedent 4 2.4 Consequence of failure to satisfy Condition Precedent 4

3 Assignment of Farmin Interest and Completion 4

3.1 Assignment of Farmin Interest 4 3.2 Pre-Completion requirements 5 3.3 Completion 5

4 Representations, warranties and acknowledgements 6

4.1 Party warranties 6 4.2 Representations and warranties by the Farmor 6 4.3 Warranties by the Farmee 7 4.4 Acknowledgement by the Farmor 7 4.5 Acknowledgements by the Farmee 7 4.6 Specific waivers 8

4.7 Mitigation and limitation on claims 8

5 Earning of Farmin Interest 9

5.1 Earning Obligation 9 5.2 Completion of Earning Obligation 9 5.3 Risk and indemnity 10

6 Party covenants 10

6.1 Farmee covenants 10 6.2 Farmor covenants 10

7 Assignment 11

7.1 Assignment by Farmor 11 7.2 Assignment by Farmee 11

8 PRRT, income tax and CGT 11

8.1 PRRT credits transfer notice 11 8.2 PRRT Information 12 8.3 Recognition of income and expenses 12 8.4 Value for CGT purposes 12

9 Goods and Services Tax 12

9 1 Definitions and interpretation 12


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9.2 Supply as a going concern 12 9.3 GST payable on other supplies 13

10 Default 13

10.1 Termination for default 13 10.2 Consequences of termination 14

11 Force Majeure 15

11.1 Meaning of Force Majeure 15 11.2 Relief 15 11.3 Labour disputes and native title matters 16 11.4 Resumption 16

12 Confidentiality 16

12.1 Agreement is confidential 16 12.2 No disclosure except as permitted 16 12.3 Permitted disclosure by a party 17 12.4 Confidential Information disclosed only as necessary 17 12.5 Publicity and disclosure 17 12.6 Access to Information 17

13 Expert determination 17

13.1 Technical disputes 17

14 Notices 18

14.1 Form of Notice 18

14.2 When Notices are taken to have been given and received 18

15 Ancillary provisions 18

15.1 Entire agreement 18 15.2 Severability 18 15.3 Waiver 19 15.4 Amendment 19 15.5 Counterparts 19 15.6 Applicable law 19 15.7 No reliance or inducement 19 15.8 Further assurances 19 15.9 Fees and charges 19 15.10 Power of attorney 20

Schedule 1 21

Basic Particulars 21

Schedule 2 23

Petroleum Titles as at the Effective Date 23

Schedule 3 24

Disclosure Materials 24 Specific disclosures [Example only] 24


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Schedule 4 25

Joint Operating Agreement 25

Schedule 5 26

Deed of Assignment and Assumption 26

Signing page 27


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Petroleum Title Farmout Agreement

Particulars

Dated as of

Parties

Farmor Name

ABN

Address

Email

Fax

Authorised Officer

Farmee Name

ABN

Address

Email

Fax

Authorised Officer

Recitals A. The Farmor is the beneficial owner, and is entitled to be registeredas the holder, of the Petroleum Title or Titles in the Title Area,including the Farmin Interest.

B. The Farmor and the Farmee have agreed that the Farmee mayacquire the Farmin Interest by satisfying the Earning Obligation onthe terms and conditions set out in this agreement .

The parties agree:in consideration of, among other things, the mutual promises contained in this agreement:

1 Definitions and interpretation1.1 Definitions

Unless the context otherwise requires, the following expressions have the followingmeanings in this agreement (including the Recitals):

Act means the legislation specified in Schedule 1.

Affiliate means, with respect to a particular entity, a related body corporate of that entity

as defined in section 50 of the Corporations Act 2001 (Cth).Agreement Date means the date of this agreement as shown on page 1, or if no date isshown then the date that this agreement is fully executed by the parties


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Approval and Registration means the approval and registration of a transfer of, anddealings with, a Petroleum Title by the relevant Authority under the Act in order togive effect to this agreement.

Approval Date means the last date on which the Conditions Precedent have beensatisfied or waived in accordance with this agreement or, if there are no ConditionsPrecedent, then the Agreement Date.

Approvals Period means the time specified in Schedule 1, or such other period agreed by the parties in writing.

Authorisation means any consent, authorisation, registration, filing, lodgement,notification, agreement, certificate, commission, lease, licence, permit, approval orexemption from, by or with an Authority including Approval and Registration.

Authority means any government department, local government council, governmentor statutory authority or agency or any other person or entity under a Law which has aright to impose a requirement on, or whose consent is required to carry out,Operations.

Completion means completion of the assignment of the Farmin Interest by the Farmorto the Farmee in accordance with this agreement.

Completion Date means the date that is 7 days after the Approval Date, or any otherdate the parties agree in writing.

Conditions Precedent means the conditions required to be satisfied for this agreementto be effective, as set out in Schedule 1.

Cost Cap means the monetary limit that the Farmee is required to initially wholly fundand spend in respect of the Earning Obligation (if any) as specified in Schedule 1.

Deed of Assignment and Assumption means the deed of assignment and assumption

of the Farmin Interest substantially in the form set out in Schedule 5 or, if no form isincluded in Schedule 5 then, and in default of agreement, the applicable AMPLAModel Form Deed of Assignment and Assumption appearing on www.ampla.org .

Disclosure Materials means, in respect of the Farmin Interest:

(a) this agreement, including Schedule 3, being a set of disclosures made by theFarmor to the Farmee i n respect of the Farmors warranties under thisagreement; and

(b) all files, records, materials, correspondence, documents and other writteninformation contained or listed in Schedule 3.

Duty means any stamp, transaction or registration duty or application fee or anysimilar charge imposed by an Authority and includes any interest, fine, penalty, chargeor other amount imposed in respect of the above, but excludes GST.

Earning Obligation means the work and expenditure of the nature and amount set outin Schedule 1 to be undertaken and incurred by the Farmee in carrying out activities inor about the Title Area pursuant to this agreement.

Earning Period means the period set out in Schedule 1.

Effective Date means the date set out in Schedule 1.

Encumbrance means any security interest, mortgage, private royalty, free carriedinterest, assignment of income, production bonus, pledge, lien, charge, title retention

arrangement, trust or power, or other form of security or interest having effect as asecurity for the payment of any monetary obligation or the observance of any otherobligation whether existing or agreed to be granted or created.
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Excepted Encumbrances are the Encumbrances set out in Schedule 1.

Excluded Loss means any one or more of:

(a) loss or damage arising out of Petroleum reservoir or formation damage, or any production delay, interruption to or loss of, or any inability to produce, deliver or process, Petroleum;

(b) loss or damage incurred, or liquidated or pre-estimated damages or penalties ofany kind whatsoever borne or payable under or in connection with any contractfor the sale, processing, storage, transportation, or other disposal of Petroleum;

(c) loss, or anticipated loss, of use, profit or revenue, loss of business reputation, business interruption of any nature, loss of opportunity, loss of anticipated savingsor wasted overheads;

(d) exemplary or punitive damages; or

(e) any loss or damage arising from special circumstances that are outside theordinary course of things.

Farmin Interest means the percentage interest in the Petroleum Title or Titles set outin Schedule 1 which is being farmed out under this agreement.

Good Australian Oilfield Practice means recognised oil and gas field methods, procedures and practices consistent with applicable Laws and Authorisations, togetherwith the exercise of that degree of skill, diligence, prudence and foresight thatreasonably would be expected from an experienced and competent contractor inAustralia under comparable conditions to the relevant activity in the light of knownfacts, or facts which should reasonably have been known at the time, and having regardto the need for:

(a) suitable and experienced personnel and adequate materials;

(b) ongoing monitoring and testing of plant and equipment performance, safeoperating procedures and appropriate maintenance procedures;

(c) the observance of relevant Australian and international standards; and

(d) in the case of design, engineering and construction, internationally accepteddesign, engineering and construction practices that reasonably would be expectedfrom recognised designers, engineers and constructors of comparable plant,equipment and facilities in Australia.

GST means any goods and services tax, value added tax or any tax analogous thereto but excludes any statutory late payment interest or penalties.

Indigenous Agreement means the indigenous agreement specified in Schedule 1.Information means information, data and records relating to Operations or otherworks carried out concerning the Title Area including all surveys, maps, aerial

photographs, electronically stored data, sketches, drawings, memoranda, drill cores,logs of those drill cores, geophysical, geological or drill maps, sampling and assayreports and notes.

JOA means the joint operating agreement to be established pursuant to this agreementin the form attached as Schedule 4, or on the basis of such other form or principles asthe parties agree.

Law means Commonwealth and State legislation, the requirements and guidelines of any

Authority, including the listing rules of a recognised stock exchange, with which a partyis legally required to comply, and common law and equity.


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Nominated State is the State or Territory of Australia as set out in Schedule 1, andincludes any adjacent offshore area of that State or Territory, if applicable.

Operations means exploration or appraisal operations or activities, including acquiringgeological, geophysical, geochemical and other similar Information, and drilling wellsfor the purpose of exploring for, or appraising, accumulations of Petroleum, includingtesting conducted in the bore of an exploration or appraisal well.

Particulars means the particulars of a party given on page 1 of this agreement, or asamended by the party by notice given in accordance with this agreement.

Past Expenditure Amount means the amount (if any) set out in Schedule 1 to be paid by way of reimbursement of past expenditure in relation to the Petroleum Title.

Petroleum has the meaning defined in the Act.

Petroleum Title means the petroleum title or titles, details or copies of which areincluded in Schedule 2, and include any application for and any extension, renewal,conversion or substitution of any of those titles.

PRRT means petroleum resource rent tax payable under the PRRT Act.

PRRT Act means the Petroleum Resource Rent Tax Assessment Act 1987 (Cth.).

Title Area means the whole of the area within the Petroleum Title and, as at theAgreement Date, as depicted on the Title Area map annexed to Schedule 2 (if any).

Transfer means a transfer of the legal title in a Petroleum Title into the name of theFarmee in the form required by and registerable under the Act.

1.2 Interpretation

In this agreement, unless the context otherwise requires:

(a) the singular includes the plural and vice-versa;

(b) headings do not affect the interpretation of this agreement;

(c) a reference to a party means a party to this agreement as listed in the Particularsand includes that partys executors, administrators, substitutes, successors and

permitted assigns;

(d) references to a part, clause, schedule, exhibit and annexure refers to a part, clause,schedule, exhibit or annexure of, in or to this agreement;

(e) a reference to this agreement includes all schedules, exhibits and annexures to thisagreement;

(f) a reference to an agreement, deed, instrument or other document includes the same

as amended, novated, supplemented, varied or replaced from time to time;(g) a reference to a court is to an Australian court;

(h) a reference to any legislation or legislative provision includes any statutorymodification or re-enactment of, or legislative provision substituted for, and anysubordinated legislation issued under, that legislation or legislative provision;

(i) a reference to a day, month or year is relevantly to a calendar day, calendar monthor calendar year;

(j) a reference to $, AUD or dollars is to the lawful currency of the Commonwealth ofAustralia;

(k) the expressions including, includes and include have the meaning as iffollowed by without limitation;


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(l) where a word or phrase is defined, its other grammatical forms have acorresponding meaning;

(m) a party may exercise a right or remedy or give or refuse its consent in itsabsolute and unfettered discretion (including by imposing conditions), unlessthis agreement expressly states otherwise; and

(n) no rule of construction is to apply to the disadvantage of a party on the basis thatthat party drafted the whole or any part of this agreement.

2 Conditions precedent2.1 Coming into effect of agreement

(a) Subject to the Act, this clause 2 and clauses 1 (Definitions and interpretation),3.2 (Pre-Completion requirements), 4 (Representations, warranties andacknowledgements), 7 (PRRT, income tax and CGT), 8 (GST), 11(Confidentiality), 12 (Notices), 13 (Assignment), 14 (Ancillary) and Schedule 1come into effect on the Agreement Date.

(b) The remainder of this agreement comes into effect on the Approval Date.2.2 Satisfaction of Conditions Precedent

(a) Each party must use all reasonable endeavours (other than waiver) at its cost toensure that each of the Conditions Precedent is satisfied within the ApprovalsPeriod.

(b) Each party must keep the other informed of its progress in obtaining satisfactionof any Condition Precedent it is required to obtain and any circumstance thatmay result in any of those conditions not being satisfied in accordance with itsterms.

(c) Each party must give the other notice that the conditions of the satisfaction of aCondition Precedent (if any) are acceptable, or unacceptable, to it.

2.3 Failure to satisfy Condition Precedent

If all Conditions Precedent are not satisfied, or otherwise waived, within the ApprovalsPeriod, or if a party, acting reasonably, gives notice to the other party that theconditions of satisfaction of a Condition Precedent imposed by a third party areunacceptable to it, either party may terminate this agreement by notice to the other,

provided that the notice must be given before the Completion Date.

2.4 Consequence of failure to satisfy Condition Precedent

If a party terminates this agreement by notice for failure to obtain satisfaction of a

Condition Precedent on conditions acceptable to it, then each party is released from allfurther obligations under this agreement, other than the obligations of confidentiality,and no party has any claim against the other party as a consequence of the termination.

3 Assignment of Farmin Interest and Completion3.1 Assignment of Farmin Interest

(a) Subject to the satisfaction of the Conditions Precedent, and in consideration ofthe terms of this agreement, the Farmor agrees to assign and transfer to theFarmee, and the Farmee agrees to accept, the Farmin Interest upon the terms andconditions of this agreement and in accordance with the Deed of Assignment andAssumption.

(b) Subject to the issue of the required Authorisations and the terms of thisagreement the assignment of the Farmin Interest as between the parties is


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effective for all purposes on and from the Effective Date. Following Completion,the beneficial interests in the Petroleum Title will be:

Party Interest

Farmor [ ]%

Farmee [ ]%

Total [ ]%

3.2 Pre-Completion requirements

Notwithstanding any other provision of this agreement, as soon as practicable after theAgreement Date:

(a) the Farmee must apply for all Authorisations to be obtained in order to satisfythe Conditions Precedent;

(b) each of the parties must, at the same time as executing this agreement, executethe Deed of Assignment and Assumption, and a Transfer if required under theAct, to be held by the Farmor pending Completion;

(c) the Farmor must provide to the Farmee, on a strictly confidential basis, alltechnical and financial information required to obtain Approval and Registration;

(d) the Farmee must lodge this agreement for Approval and Registration, and whendoing so, to the extent permitted by the Act, must require that only a summaryinstrument (or a supplementary instrument), and not the original instrument, beavailable for public inspection on the grounds that this agreement containscommercially sensitive information;

(e) the Farmee must bear and pay the costs of obtaining all Authorisations requiredfor the assignment of the Farmin Interest, including all Duties, but excluding anyinternal costs or external advisory costs incurred by the Farmor; and

(f) the parties acknowledge that no dealing contained in this agreement is of anyforce or effect until approved and registered under the Act.

3.3 Completion

(a) On the Completion Date the parties must meet at 11.00 am at the offices of theFarmor, or such other time or place as the parties may agree, at which time:

(i) the Farmor must deliver any Information held by the Farmor to the Farmeethat has not been previously provided, subject to any applicableconfidentiality restriction;

(ii) the Farmee must pay to the Farmor the Past Expenditure Amount (if any);

(iii) the Farmor must deliver to the Farmee a duly executed Deed ofAssignment and Assumption (and the Transfer if required under the Act)of the Farmin Interest;

(iv) the Farmor must deliver to the Farmee a duly executed deed of assignmentand assumption of any Indigenous Agreement or other third partyagreement relating to the Farmin Interest required under any Law; and

(v) on or before the Completion Date, execute the JOA and deliver duly executed

copies of the JOA to each other.(b) Subject to Completion occurring and this agreement, with effect on and from the


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Effective Date the Farmee assumes all of the rights, benefits, obligations andliabilities of the Farmin Interest in place of the Farmor.

(c) On and from the Completion Date and subject to this agreement:

(i) the parties agree to associate themselves in and form a joint venture toexplore for Petroleum and appraise, develop or exploit discoveries in

relation to the Title Area on the terms of the JOA;(ii) the first operator of the joint venture is the party named as operator in the

JOA and in Schedule 1; and

(iii) if there is any inconsistency between the JOA and this agreement, thisagreement will prevail to the extent of the inconsistency; and

(iv) if the parties cannot agree on a term of the JOA, they agree to adopt theequivalent term set out in the AMPLA Model Petroleum Joint Operatingagreement posted at that time on www.ampla.org .

(d) Upon Completion, the Farmor must conduct an accounting and make anyadjustments as are necessary to reflect the assignment of the Farmin Interest as atthe Effective Date, such adjusted amounts to be settled within 7 days of theconclusion of such accounting.

(e) The obligations of the Farmor and the Farmee under this clause areinterdependent. Completion is conditional upon, and will not be taken to haveoccurred until, both the Farmor and the Farmee have complied with all of theirrespective obligations under this clause.

4 Representations, warranties and acknowledgements4.1 Party warranties

Each party warrants for the benefit of the other party that:

(a) (Incorporation ) it is validly incorporated, organised and subsisting inaccordance with the laws of its place of incorporation;

(b) (Power and capacity ) it has full power and capacity to enter into and performits obligations under this agreement and is qualified to do business in the

Nominated State;

(c) (Corporate authorisations ) all necessary authorisations for the execution,delivery and performance by it of this agreement in accordance with its termshave been obtained;

(d) (No legal impediment ) its execution, delivery and performance of this

agreement complies with its constitution and does not constitute a breach of anylaw or obligation, or cause a default under any agreement by which it is bound;

(e) (Insolvency ) no meeting has been convened, resolution proposed or order madefor the winding up, or the appointment of an administrator, of it, and nomortgagee or chargee has taken, attempted to take or indicated an intention toexercise its rights under any security; and

(f) (No trust ) it enters into and performs this agreement on its own account and notas trustee for or nominee of any other person.

4.2 Representations and warranties by the Farmor

The Farmor warrants for the benefit of the Farmee in respect of each Petroleum Titlethe subject of this agreement that, as at the Agreement Date, and as at the ApprovalDate and at the Completion Date, except as otherwise disclosed in the Disclosure
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Materials:

(a) it is the legal and beneficial owner of the Farmin Interest, free of Encumbrancesor claims by third parties, other than the Excepted Encumbrances;

(b) there is no matter, fact or thing which would preclude the Farmor from disposingof the Farmin Interest to the Farmee in accordance with this agreement; and

(c) the Petroleum Title is in good standing under the Act and is not liable tocancellation or forfeiture for any reason and it is not aware of any circumstanceswhich may give rise to such cancellation or forfeiture;

(d) it has complied with all obligations and Laws in respect of the Petroleum Titleand all Authorisations in all material respects;

(e) it is not engaged in any litigation, arbitration or other proceeding concerning thePetroleum Title and it is not aware of any pending or threatened litigation,arbitration or other proceeding concerning the Petroleum Title;

(f) to the best of the Farmors knowledge and belief, ther e is no informationrelevant to the Farmin Interest which has not been included in the DisclosureMaterials and which could reasonably be expected to have a material adverseeffect on the value of the Farmin Interest;

(g) it has provided complete and accurate answers to requests for Information madeto the Farmor by or on behalf of the Farmee; and

(h) to the best of its knowledge and belief, having made all reasonable enquiries,Operations performed in the Title Area or in relation to the Petroleum Title,including the completion and abandonment of any wells, have been carried outin accordance with Good Australian Oilfield Practice,

provided that each of the above warranties must be construed as a separate warranty

and must not be expanded by reference to any other matter, warranty, representation orundertaking.

4.3 Warranties by the Farmee

The Farmee warrants for the benefit of the Farmor that at the Agreement Date and atthe Completion Date:

(a) there are no material claims, demands, actions, suits, governmental inquiries, or proceedings pending, or to the Farmees knowledge, threatened, against theFarmee which would have a material adverse effect upon the completion of thetransactions contemplated by this agreement; and

(b) the Farmee has the financial resources, and the technical capability, personneland resources, to enable it to fulfil all of its prospective obligations and liabilitiesunder the Petroleum Title and this agreement.

4.4 Acknowledgement by the Farmor

The Farmor acknowledges that the Farmee may audit all costs and payments made bythe Farmor in respect of the Farmin Interest under this agreement in accordance withthe audit provisions in the Accounting Procedure attached to the JOA.

4.5 Acknowledgements by the Farmee

The Farmee acknowledges and agrees that:

(a) it has undertaken its own due diligence in relation to the Farmin Interest and hasrelied on its own independent technical, commercial, fiscal and legal judgementin entering into this agreement;


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(b) except for the warranties specifically given in this agreement:

(i) the Farmor makes no warranties or representations (express or implied) inrelation to the Farmin Interest or the Disclosure Materials;

(ii) all warranties and representations, whether express, implied, written, oral,collateral, statutory or otherwise, are excluded; and

(iii) the Farmor disclaims all liability in relation to the excluded warranties andrepresentations to the maximum extent permitted by law; and

(c) the Farmors warranties are not breached, and each representation in theFarmors warranties is qualified , by matters contained in this agreement, theDisclosure Materials, all publicly available information and data available to theFarmee and any matter within the actual knowledge of the Farmee as at theAgreement Date.

4.6 Specific waivers

To the maximum extent permitted by law, the Farmee irrevocably waives any right itmay have to bring an action in respect of any contravention of the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission Act 1989 (Cth) andthe Consumer and Competition Act 2010 (Cth) or corresponding State or Territorylegislation in respect of any statement, representation, conduct or omission by or on

behalf of the Farmor which is not expressly contained in this agreement.

4.7 Mitigation and limitation on claims

(a) A party must use all reasonable efforts to avoid or mitigate any loss or damageincurred by it which may give rise to a claim by it under or in connection withthis agreement, including under any warranty given by the other party.

(b) A party has no liability to the other party in respect of a claim under or inconnection with this agreement to the extent that the other party has recoveredfrom, or been indemnified by, a third party under the terms of any insurance

policy in respect of the loss or damage giving rise to such claim.

(c) Notwithstanding anything else in this agreement or otherwise, the Farmeeundertakes not to make any claim against the Farmor in relation to:

(i) any geological, geophysical, engineering, economic, fiscal, legal or otherdata, interpretations or evaluations (including resources and reserves) bythe Farmor, any of its Affiliates or any other person affecting thePetroleum Title or this agreement;

(ii) any matter that the Farmee knows or could have known, by reasonable

enquiry, before the Completion Date;(iii) future matters, including future or forecast costs, revenues, markets,

reserves, life of fields, production or profits;

(iv) the legal and fiscal environment of the Petroleum Title, or any change tosuch environment or implications arising after the Completion Date; or

(v) the accuracy or reliability of any information or material which wascreated by persons other than the Farmor and which was provided to theFarmee in connection with the Farmin Interest or the transactioncontemplated by this agreement.

(d) A party is not liable to make any payment for breach of warranty under thisagreement unless the amount of a claim exceeds the Claim Threshold set out inSchedule 1 in which event the party is liable for the whole of that amount, not


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merely the excess.

(e) A party must not recover more than once in respect of a matter giving rise to aclaim.

(f) Any claim by a party for a breach of warranty or representation under thisagreement is taken to be waived or withdrawn and is barred and unenforceable

on and after the date which is 12 months after the Completion Date unless proceedings in respect of such claim are commenced within 6 months from theCompletion Date.

5 Earning of Farmin Interest5.1 Earning Obligation

(a) During the Earning Period the Farmee must:

(i) undertake, incur and satisfy the Earning Obligation; and

(ii) pay all monies in respect of the Farmin Interest it has agreed to pay underthis agreement on or before the due date, or otherwise as the Farmordirects.

(b) If there is a Cost Cap specified in Schedule 1, and the cost to the Farmee of theEarning Obligation exceeds the Cost Cap ( Excess Cost ), the Farmee must pay orreimburse all of the expenditure incurred in performing the Earning Obligationup to the limit of the Cost Cap. Thereafter the Excess Cost to be paid in

performing the Earning Obligation must be paid or reimbursed by the Farmorand the Farmee in proportion to their interest in the Petroleum Title as it isagreed to be at the Effective Date, or as otherwise agreed.

5.2 Completion of Earning Obligation

(a) The Earning Obligation is satisfied and completed under this agreement if:

(i) to the extent that the work or expenditure specified in the Earning Obligationis required to satisfy a relevant commitment under the Petroleum Title, therelevant Authority accepts that the work or expenditure satisfies therelevant commitment, and the Farmee has spent the remainder of themoney or completed the remainder of the work (if any) specified in theEarning Obligation; or

(ii) a well drilled as part of the Operations:

A. encounters impenetrable substances, basement, commercialquantities of Petroleum at a lesser depth; or

B. is forced to be abandoned because of difficulties insurmountable byemploying modern drilling technology in conformity with sound,cost effective practices generally accepted in the international

petroleum industry,

and:

C. the relevant Authority accepts that the work or expenditure specifiedin the Earning Obligation is sufficient to satisfy the relevant wellcommitment under the Petroleum Title; or

D. the Farmee has spent the amount of money or completed the workspecified in the Earning Obligation.

(b) If the cost of satisfaction and completion of the Earning Obligation is less than that provided for in this agreement, the Farmee will nevertheless earn the Farmin Interest


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and is not obliged to pay any costs greater than the actual cost of satisfying andcompleting the Earning Obligation.

5.3 Risk and indemnity

(a) The Farmor retains all risk and liability of any nature connected with ownershipof and operations undertaken in connection with the Farmin Interest on or prior

to the Effective Date and agrees to indemnify, defend and hold the Farmeeharmless from all costs, liabilities, penalties, claims, causes of action, demands,lawsuits and expenses (including without limitation, court costs and reasonablelegal fees) associated with such ownership or arising out of any operation,accident, act, event or circumstance occurring prior to the Effective Date.

(b) The Farmee assumes all risk and liability of any nature connected with theownership of and operations undertaken in connection with the Farmin Interestfrom the Effective Date and agrees to indemnify, defend and hold the Farmorharmless from all costs, liabilities, penalties, claims, causes of action, demands,lawsuits and expenses (including without limitation, court costs and reasonablelegal fees) associated with such ownership or arising out of any operation,

accident, act, event or circumstance occurring on or after the Effective Date.

6 Party covenants6.1 Farmee covenants

During the Earning Period, the Farmee covenants for the benefit of the Farmor to:

(a) not prejudice by any act or omission the good standing of the Petroleum Titleunder the Act;

(b) comply with the Act, the terms and conditions of the Petroleum Title, and allother Laws that relate to the Petroleum Title or the performance of Operationsunder this agreement;

(c) not create or permit the creation of any Encumbrance over the Farmin Interest,other than an Excepted Encumbrance;

(d) not sell, assign or otherwise deal with or dispose of the whole or any part of itsinterest in the Petroleum Title, except with the prior consent of the Farmor;

(e) complete all the minimum work obligations under the Petroleum Title which are part of the Earning Obligation; and

(f) waive any right it may have to withdraw from this agreement until it has fullysatisfied the minimum work and expenditure obligations that form part of theEarning Obligation.

6.2 Farmor covenants

During the Earning Period, the Farmor covenants for the benefit of the Farmee to:

(a) promptly provide to the Farmee any Information relating to the Petroleum Titlethat it receives at the expense of the Farmee;

(b) keep the Farmee fully informed of material matters relating to the FarminInterest, including any proposed budget and the receipt of any Information;

(c) inform the Farmee of any changes to the facts in the representations andwarranties given under this agreement of which it becomes actually aware,having made due and careful inquiry, prior to the Completion Date;

(d) advise the Farmee of any proposed assignment or dealing affecting any interestin the Petroleum Title of which the Farmor becomes aware;


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(e) not agree to terminate or make any amendment or variation to the PetroleumTitle without the consent of the Farmee (which consent is not to be unreasonablywithheld or delayed);

(f) discharge its obligations and duties under the Petroleum Title and the Act inrespect to the Farmin Interest;

(g) promptly notify the Farmee and provide details upon the occurrence of:(i) any written notice of default or termination received or given by the

Farmor with respect to the Farmin Interest;

(ii) any written notice of any pending or threatened claim, demand, action,suit, inquiry or proceeding related to the Farmin Interest;

(iii) any event or condition that would have a material adverse effect on the business, operations, financial condition or results of Operations affectingthe Farmin Interest taken as a whole; or

(iv) any event or condition that would render impossible the Farmees right tothe assignment of the Farmin Interest;

(h) not create or permit the creation of any Encumbrance over the Farmin Interestother than an Excepted Encumbrance; and

(i) promptly notify the Farmee of any notice or communication received by theFarmor from any Authority which in any way affects the Farmin Interest or fromany th ird party which in the Farmors opinion, acting reasonably, materially anddirectly affects the Farmin Interest.

7 Assignment7.1 Assignment by Farmor

The Farmor may sell, assign or dispose of any legal or beneficial interest in thePetroleum Title, except that during the Earning Period the Farmor must not sell, assign,charge, declare a trust over, or dispose of any legal or beneficial interest in the FarminInterest except subject to and in accordance with the terms of this agreement.

7.2 Assignment by Farmee

(a) The Farmee may not assign, transfer, charge or declare a trust of any ofits rights or interests under this agreement without the prior written approval ofthe Farmor, which approval must not be unreasonably withheld or delayed.

(b) The Farmor may not withhold approval of a proposed assignment by theFarmee to an Affiliate provided the assignment is made in compliance with the

Act and the Petroleum Title and the assignment results in both the Farmee andthe assignee being jointly and severally liable for the Farme es obligations underthis agreement.

8 PRRT, income tax and CGT8.1 PRRT credits transfer notice

(a) Within 60 days after the Completion Date, the Farmor must provide the Farmeewith a transfer notice in accordance with section 48 (3) or section 48A (11) ofthe PRRT Act, and in the form required by the Australian Tax Office ( TransferNotice ) setting out the total expenditure taken to be incurred by the Farmee inrespect of the Farmin Interest.

(b) If as a result of an audit of the Farmor or the Farmee undertaken under the PRRTAct the total expenditure taken to be incurred by the Farmee under sections 48


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or 48A of the PRRT Act in respect of the Farmin Interest differs from theexpenditure recorded in the Transfer Notice, the Farmor must as soon as

practicable provide the Farmee with a Transfer Notice, in replacement of theTransfer Notice previously given, setting out the actual total expenditure taken to

be incurred by the Farmee under sections 48 or 48A of the PRRT Act in respectof the Farmin Interest.

8.2 PRRT Information

The Farmor must make available to the Farmee in a timely manner any records,documentation and other information in its possession or available upon enquiry as theFarmee may reasonably request in order for the Farmee to verify, substantiate anddeduct the expenditure identified in the Transfer Notice.

8.3 Recognition of income and expenses

(a) The parties agree that the Transfer Time (as defined in the PRRT Act) isthe Completion Date and the entitlement of the Farmee and the Farmor to PRRTexpenditure pursuant to sections 48 or 48A of the PRRT Act is determined as atthat date.

(b) The Farmor must recognise the income and expenditures attributable tothe Farmin Interest for income tax and PRRT purposes for all periods up to theEffective Date.

(c) The Farmee must recognise the income and expenditures attributable tothe Farmin Interest for income tax and PRRT purposes for all periods on andafter the Effective Date.

(d) The Farmee must claim a PRRT deduction for any eligible PRRTexpenditure contributed by the Farmee for the Earning Obligation including thePast Expenditure Amount, if any.

(e) The parties must file all income tax returns on the same basis as provided in this clause.

8.4 Value for CGT purposes

For the purposes of assessing capital gains tax payable under the Income Tax Assessment Act 1997 (Cth) ( CGT ) (if applicable), the parties agree that each PetroleumTitle has the characteristics and value set out in Schedule 1.

9 Goods and Services Tax9.1 Definitions and interpretation

(a) Any reference in this clause to a term defined or used in the A New Tax System(Goods and Services Tax) Act 1999 (Cth) ( GST Act ) is, unless the contextindicates otherwise, a reference to that term as defined or used in that Act.

(b) Except where otherwise expressly stated, any amount referred to in thisagreement which is relevant in determining a payment to be made by one of the

parties to the other is, unless indicated otherwise, a reference to that amountexpressed on a GST exclusive basis.

9.2 Supply as a going concern

(a) The parties agree that the assignment of the Farmin Interest constitutes thesupply of a going concern and, as understood by the parties, is GST free.

(b) The Farmor warrants that it is registered or required to be registered for GST andwill remain so until the Completion Date.


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(c) The Farmor warrants that, subject to the rights of the Farmee under thisagreement, it will carry on the enterprise constituted by the Farmin Interest untilthe Completion Date.

(d) The Farmee warrants that, subject to the rights of the Farmor under thisagreement, it will supply all things necessary for the continued operation of theenterprise constituted by the Farmin Interest between the Agreement Date andthe end of the Earning Period.

(e) Notwithstanding the understanding of the Farmor and the Farmee that thisfarmout constitutes the supply of a going concern and is GST-free, if for anyreason the farmout of the Farmin Interest is not accepted by the Commissioner ofTaxation ( CoT ) in its entirety as a GST free supply of a going concern and isentitled to recover the GST payable by the Farmor in respect of the disposal:

(i) the Farmee must pay to the Farmor an amount equal to the amount of theGST payable by the Farmor in respect of the disposal within 14 days afterthe CoT confirms the Farmors liability to GST in an assessment orcorrespondence, together with an amount equal to any penalties or interestimposed on the Farmor in respect of that amount;

(ii) the Farmor must give the Farmee a copy of the assessment orcorrespondence received from the CoT and issue a tax invoice as a

precondition to payment by the Farmee; and

(iii) it will not be a defence to any claim for payment pursuant to this clausethat the Farmor failed to mitigate its damages by paying an amount ofGST when it fell due.

9.3 GST payable on other supplies

(a) If GST is imposed on a supply made under or in connection with this agreement

(other than the supply constituted by the farmout of the Farmin Interest), theconsideration for the supply is increased by an amount equal to the considerationotherwise payable for the supply multiplied by the rate at which the GST isimposed under the GST Act. The additional consideration is, subject to thesupplier issuing a tax invoice to the recipient, payable at the same time and in thesame manner as the consideration to which it relates.

(b) If one of the parties to this agreement is entitled to be reimbursed or indemnifiedfor a loss, cost, expense or outgoing incurred in connection with this agreement,then the amount of the reimbursement or indemnity payment must be reduced byan amount equal to any Input Tax Credit (as defined in the GST Act) to whichthe party being reimbursed or indemnified (or its representative member) is

entitled in relation to that loss, cost, expense or outgoing.

10 Default10.1 Termination for default

(a) If the Farmee fails to pay or reimburse any amount which falls due, or if theFarmee is otherwise in default of its obligations under this agreement, and suchfailure or default is not remedied within 14 days, the Farmor may give to theFarmee notice of default and of its intention to terminate this agreement.

(b) If the Farmee does not wholly satisfy the Earning Obligation within the time provided by this agreement to the satisfaction of the Farmor, acting reasonably,

and such failure is not otherwise excused under this agreement, the Farmor mayalso by notice terminate this agreement and the JOA (if executed).


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(c) Unless the Farmee remedies the default within 10 days of receipt of the notice ofdefault given by the Farmor, the Farmor may terminate this agreement forthwith

by further notice to the Farmee.

(d) The Farmee may terminate this agreement at any time by notice in writing to theFarmor if the Farmor has:

(i) breached a material provision of this agreement, provided that such breachhas not been waived by the Farmee or remedied by the Farmor (if capableof remedy) within 14 days after receiving notice of the breach from theFarmee; and

(ii) such breach is continuing at the time of termination.

10.2 Consequences of termination

(a) Immediately upon either party giving a notice of termination under thisagreement, the Farmee must, if the Farmor so by notice requires:

(i) if any Authorisation or Approval and Registration in respect of thePetroleum Title forming part of the Farmin Interest required by thisagreement has not yet been obtained, withdraw its application for suchAuthorisation or Approval and Registration forthwith;

(ii) execute and deliver to the Farmor all documents necessary to re-assign andre-transfer the Farmin Interest to the Farmor with the result that theFarmee;

A. ceases to have an interest in the Petroleum Title and the JOA (ifexecuted); and

B. is deemed to have withdrawn from this agreement in respect to thePetroleum Title;

(iii) do everything necessary on the Farmees part to restore the Farmorsrights, title and interests in the Petroleum Title to the same position as itwas immediately prior to the Agreement Date including:

A. the obtaining of all Authorisations required under the Act orotherwise to enable the delivery to the Farmor of a fully effectiveDeed of Assignment and Assumption and a Transfer (if requiredunder the Act) of the Farmin Interest in favour of the Farmor;

B. execute and deliver to the Farmor any other documents necessary torestore the Farmors rights, title and interest in the Petroleum Title tothe same position as it was immediately prior to the Agreement

Date; andC. return to the Farmor (or destroy at the Farmors request) all

Disclosure Materials held by the Farmee, including all copies, otherthan Disclosure Materials the Farmee is required to retain by law;and

(iv) return to the Farmor (or destroy at the Farmors request) all DisclosureMaterials held by the Farmee, including all copies, other than DisclosureMaterials the Farmee is required to retain by Law.

(b) If the notice of termination of this agreement has been validly given by theFarmee under this agreement, upon the Farmor receiving the Disclosure

Materials required to be returned by the Farmee, the Farmor must reimburse tothe Farmee forthwith all amounts that the Farmee has paid to or on behalf of theFarmor under this agreement in respect of the Farmin Interest.


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(c) Upon valid termination of this agreement by either party, this agreement is at anend, other than for this clause and the provisions relating to confidentiality,notices, dispute resolution (if applicable), applicable law and jurisdiction, andany outstanding payment or reimbursement obligations.

(d) Termination of this agreement by either party is without prejudice to any otherrights or remedies that either party may have which accrues prior to the date oftermination or otherwise from a partys failure to meet its obligations under thisagreement.

(e) If the Farmee fails or refuses to execute and deliver any of the documentsrequired under this clause, the Farmee authorises the Farmor, on its behalf and inits name, to do all such acts and execute all such documents at the sole cost andexpense of the Farmee as may appear to the Farmor (acting reasonably) to benecessary or desirable to give effect to the re-assignment and re-transfer

provided for in this clause, and the Farmee is bound by all acts of the Farmor pursuant to this clause.

11 Force Majeure11.1 Meaning of Force MajeureIn this agreement, Force Majeure means any cause which is not reasonably withinthe control of the party claiming relief under this clause, which cause may include:

(a) an act of God, earthquake, lightning, fire, flood, storm, cyclone, explosion orepidemic;

(b) strike, lockout, stoppage, ban or other types of labour difficulty whether at theTitle Area, railway or port or otherwise;

(c) war (whether declared or undeclared), blockade, act of the public enemy, act ofterrorism, revolution, insurrection, riot, civil commotion, sabotage, maliciousdamage, radioactive contamination, toxic or dangerous chemical contamination;

(d) action or inaction by a competent Authority (including heritage related restraintsand refusal or failure to grant any Authorisation despite timely reasonableendeavours to obtain the same);

(e) inability to access all or any part of a Title Area because of claims to or rights ofnative title or otherwise;

(f) unavailability or mechanical and electrical breakdown and failure of equipment, plant, pipelines, transmission lines or transport; or

(g) any other cause whether specifically listed above or otherwise which is notreasonably within the control of the party claiming Force Majeure

except where:

(h) the cause is the inability to obtain, use or pay, moneys for any reason; or

(i) the consequences of the cause could have been prevented or remedied by theexercise by the party affected of Good Australian Oilfield Practice .

11.2 Relief

If, as a direct result of an event or occurrence of Force Majeure ( Force Majeure Event ),a party becomes unable, wholly or in part, to perform an obligation (other than anobligation to obtain, use or pay money) under this agreement ( Affected Party) :

(a) that Affected Party may give the other party notice of the Force Majeure Eventwith reasonably full particulars and, insofar as is known to it, the probable extent


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to which it will be unable to perform, or be delayed in performing, that obligation;

(b) on giving the notice of the Force Majeure, that obligation is suspended, but only tothe extent that, and for so long as, it is affected by the Force Majeure Event;

(c) the Affected Party must use all reasonable diligence to remove, overcome or abatethe effect of the Force Majeure Event as quickly as possible;

(d) if the Force Majeure Event cannot be removed, overcome or abated to an extentthat allows resumption of performance within 6 months (or such other period asthe parties agree) from the date of the notice, the parties must consider anddetermine whether this agreement needs to be modified or terminated; and

(e) notwithstanding the Force Majeure Event, the parties must continue to expendsuch monies as are necessary to keep the Petroleum Title in good standing inaccordance with Good Australian Oilfield Practice.

11.3 Labour disputes and native title matters

The obligation to use all reasonable diligence to overcome or remove the effect of theForce Majeure does not require the Affected Party to:

(a) settle any strike, or other labour dispute;

(b) contest the validity or enforceability of any law, regulation or legally enforceableorder by way of legal proceedings; or

(c) enter into any agreement or settle any dispute concerning native title rights orclaims,

on terms not acceptable to it solely for the purpose of removing the event of ForceMajeure.

11.4 Resumption

The Affected Party must resume performance of its obligations as soon as, and to theextent that, it is no longer affected by the Force Majeure Event.

12 Confidentiality12.1 Agreement is confidential

(a) The parties acknowledge and agree that:

(i) the terms and conditions of this agreement; and

(ii) all information (including Information) flowing to any party from, or inrelation to, Operations,

(collectively Confidential Information ) are confidential to the parties andcommercially sensitive other than information which is already within the publicdomain independently of any breach by a party of this agreement.

(b) To the extent permitted by the Personal Property Securities Act 2009 (Cth)(PPSA ), the parties agree to keep all information of the kind mentioned in section275(1) of the PPSA confidential and not to disclose that information to any other

person, except as permitted by this agreement.

12.2 No disclosure except as permitted

Except as permitted by this agreement, each party undertakes that it will keepconfidential all Confidential Information received by it and that neither it nor its

employees will, without the consent of the other party, disclose any ConfidentialInformation to any third party.


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12.3 Permitted disclosure by a party

(a) A Party may disclose Confidential Information :

(i) to the professional advisers or agents of that party;

(ii) to an Affiliate of that party;

(iii) as required by Law or by any competent Authority, whether the obligationarises as a consequence of the act of the party or otherwise;

(iv) to any recognised stock exchange which requires disclosure pursuant to itslisting rules;

(v) where reasonably necessary for the purposes of any arbitration oradministrative or legal proceedings involving only the parties; or

(vi) to a third party, and its advisers, bona fide tendering for or negotiating the purchase or financing of all or part of the business of that party whichincludes the Petroleum Title but only if the third party and its advisers firstcovenant in writing to the disclosing party to preserve confidentiality of

information disclosed in the same terms as this clause.(b) A party making a permitted disclosure under this clause must take all reasonable

steps to ensure that the person to whom disclosure is made keeps confidential allConfidential Information disclosed.

12.4 Confidential Information disclosed only as necessary

(a) Each party must take all steps reasonably necessary to ensure that ConfidentialInformation obtained is disclosed to and known by only those persons who need toacquire that knowledge in the course of their duties.

(b) Each party may use for its own internal purposes not related to Operations anygeological, geophysical, geochemical, metallurgical or operational concept, modelor principle of any kind, even if derived from the Confidential Information.

12.5 Publicity and disclosure

(a) Except for an announcement or other disclosure required by Law or permitted bythis agreement, no public announcement naming a party or other public disclosuremay be made in relation to Operations unless the text of the announcement ordisclosure has been approved by the other party.

(b) To the extent that an announcement or other disclosure is required by Law, the parties must use all reasonable endeavours to agree, as soon as reasonably practicable, the wording of such announcement or disclosure before it is made.

12.6 Access to Information(a) Each party is entitled to full disclosure of all Information available to the other

party in respect of Operations or any other operations carried out by the other party in the Title Area.

(b) No party is required to disclose to the other party the modelling, assessment ordevelopment it makes from such Information.

(c) If Information has been provided to a party under an intellectual property licencewhich precludes provision to the other party, the obligation to provide suchinformation is restricted to the extent provided in the relevant licence.

13 Expert determination13.1 Technical disputes


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(a) If any dispute arises out of, or in connection with, this agreement which is primarily of a technical or engineering nature either party may, on giving notice tothe other party, refer the dispute to a technical expert to resolve the dispute whowill act as an expert and not as an arbitrator.

(b) If the parties do not agree on an expert within 14 days of a party giving notice,either party may request The Institute of Arbitrators & Mediators Australia, or itssuccessor organisation, to appoint such expert.

(c) The expert must endeavour to resolve the dispute in accordance with, and subjectto, The Institute of Arbitrators & Mediators Australia Expert Determination Rules.

(d) An agreement to submit a dispute to the decision of a technical expert isirrevocable and the parties must seek a decision from the expert appointed withoutundue delay and are bound by the award or awards made by the expert withoutfurther right of appeal.

14 Notices14.1 Form of Notice

Unless expressly stated otherwise in this agreement, any notice, certificate, consent,approval, waiver or other communication in connection with this agreement ( Notice )must be in writing or given by electronic transmission, signed by the sender (if anindividual) or the person nominated by a party in the Particulars, or by notice given inaccordance with this agreement, as its Authorised Officer, and marked for the attentionof that person as Authorised Officer identified in the Particulars or, if the recipient hasnotified otherwise, then marked for attention in the last way notified.

14.2 When Notices are taken to have been given and received

(e) A Notice is regarded as given and received:

(i) if delivered by hand, when left at the address given in the Particulars;(ii) if sent by pre-paid post, on the 3 rd day following the date of postage;

(iii) if given by fax, on production of a transmission report by the machine fromwhich the fax was sent which indicates that the fax was sent in its entirety tothe recipients fax number, unless the recipient informs the sender that the

Notice is illegible or incomplete within 4 hours of it being transmitted; or

(iv) if sent by email, at the time shown in the delivery confirmation reportgenerated by the senders email system which indicates that the email wassent to the recipients email address.

(f) A Notice delivered or received other than on a day on which trading banks areopen for business in the capital city of the Nominated State or after 5.00pm(recipients time) is regarded as received at 9.00am on the following day that suchtrading banks are open for business. A Notice delivered or received before 9.00am(recipients time) is regarded as received at 9.00am.

15 Ancillary provisions15.1 Entire agreement

This agreement contains everything the parties have agreed in relation to the subjectmatter it deals with. No party can rely on an earlier written document or anything saidor done by the other party, or by a director, officer, agent, employee or contractor of

that party, before this agreement was executed, save as permitted by law.15.2 Severability


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If any provision of this agreement is void, illegal or unenforceable, it may be severedwithout affecting the enforceability of the other provisions in this agreement.

15.3 Waiver

A waiver of any right, power or remedy under this agreement must be in writing signed by the party granting it. A waiver is only effective in relation to the particular

obligation or breach in respect of which it is given. It is not to be taken as an impliedwaiver of any other obligation or breach or as an implied waiver of that obligation or breach in relation to any other occasion.

15.4 Amendment

No modification, variation or amendment of this agreement is of any force unless it isin writing and has been signed by each of the parties.

15.5 Counterparts

This agreement may be executed in any number of counterparts and by different parties in separate counterparts. Each counterpart when so executed is deemed anoriginal but all of which together constitute one and the same instrument. Delivery ofan executed signature page of a counterpart by facsimile transmission or in AdobePortable Document Format (PDF) sent by electronic mail takes effect as delivery of anexecuted counterpart of this agreement. Each party must be provided with an originalof the executed signature page as soon as reasonably practicable thereafter

15.6 Applicable law

(a) This agreement is governed by and must be construed in accordance with thelaws of the Nominated State.

(b) The parties submit irrevocably to the non-exclusive jurisdiction of the courts ofthe Nominated State and all courts competent to hear appeals from those Courts.

15.7 No reliance or inducementWithout limiting any express representation, warranty or acknowledgement providedfor in this agreement, each party warrants and agrees that when entering into thisagreement it relied exclusively on the following matters independently of anystatements, inducements or representations made by, or on behalf of the other party(including without limitation by the officers, employees, contractors, professionaladvisers or agents or any other person acting on behalf of a party):

(a) its own inspections, investigations, skill and judgement;

(b) the terms expressly contained in this agreement; and

(c) opinions and advice obtained independently of any other party.

15.8 Further assurances

Each party must execute all documents and do all things reasonably necessary ordesirable to give full effect to:

(a) this agreement; and

(b) any matter or thing contemplated pursuant to this agreement.

15.9 Fees and charges

(a) Each party must bear its own costs for the preparation, execution,delivery and performance of this agreement and any agreement or document

entered into or signed under this agreement.


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(b) All Duties relating to the execution, registration and performance of thisagreement, and of all other documents arising out of this agreement, must be

paid by the Farmee, except that the Farmor must pay all Duties and costs inrelation to the re-assignment of the Farmin Interest to the Farmor if the Farmeeterminates this agreement for breach by the Farmor of a material provision ofthis agreement

15.10 Power of attorney

Each attorney that executes this agreement states that the attorney has no notice thatthe power of attorney under which they were appointed has been revoked.


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Schedule 1Basic Particulars

Act: [ Insert applicable Petroleum Act(s) or other legislation ] (Clause 1.1) [e.g. Offshore Petroleum and Greenhouse Gas Storage Act

2006 (Cth) and all subordinate legislation and directionsin effect under it.]

Approvals Period: [ Insert ] months from the Agreement Date, or such(Clause 1.1) longer period as the parties may agree.

Claim Threshold: [ Insert amount and whether it applies to a single claim or a (Clause 4.6(d)) series of claims .]

Conditions Precedent : [Examples only](Clause 1.1)

1. The obtaining by [specify party] of all Authorisations requiredunder [specify legislation] by [insert date].

This Condition Precedent 1 is for the benefit of the parties andmay be waived by each party in whole or in part by givingnotice to that effect to the other party.

2. The obtaining by [specify party] of the approval of [specifynative title/indigenous party] to the assignment andassumption of the Indigenous Agreement to the Farmee to theextent of the Farmin Interest and the release of the Farmorsfuture obligations under the Indigenous Agreement to theextent of the Farmin Interest by [insert date].

This Condition Precedent 2 is for the benefit of the parties and

may be waived by each party in whole or in part by givingnotice to that effect to the other party.

3. [other - specify Authorisation required, and party required toobtain it ] by [insert date ]].

This Condition Precedent 3 is for the benefit of the parties andmay only be waived by agreement between the parties.

4. The obtaining by [specify party] of all [assignments of thefollowing third party agreements required under [specifylegislation] by [insert date].

This Condition Precedent 4 is for the benefit of the parties andmay only be waived by agreement between the parties.

Cost Cap : [ Insert amount ](Clause 5.1)

Earning Obligation : [ Insert work and $ amount ].(Clause 1.1) [Examples only]

1. The Farmee reimbursing agreed past costs of the Farmor as setout in Schedule [ insert Schedule used ].

2. The Farmor being free carried by the Farmee to the extent ofsome/all of the Farmors Percentage Share of the future work

program (including/excluding the costs of the proposed[ ] well).


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3. The Farmee paying some/all costs of the 2D/3D seismic[ specify ] to be shot over the Petroleum Title.

4. The Farmee paying some/all costs of one or more wells.

5. The Farmee paying uplift payments and/or royalties to theFarmor on the issue of a production licence or retention lease.

Earning Period : [ Insert period ] from the Completion Date.(Clause 1.1)

Effective Date : [ Insert date ].(Clause 1.1)

Excepted Encumbrances : [ List, if any ] (Clause 1.1) [Example only]

Royalties, duties, or taxes payable under existing State orCommonwealth legislation.

Farmin Interest: [ Insert number ] % Interest.(Clause 1.1)

Indigenous Agreement: Agreement dated [insert date] and made between (Clause 1.1) [insert parties]

Nominated State : [ Insert relevant State or Territory ].(Clause 1.1)

Operator : [ Insert name of party ].(Clause 3.3(b)(iii))

Past Expenditure Amount: [ Insert $ amount ]. (Clause 1.1)

Petroleum Title: Characteristics: [Wildcat exploration area ](Clause 1.1) Value: [ Nil ].


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Schedule 2Petroleum Titles as at the Effective Date

No. Reg. Holder(s) Grant date Expiry date

[OR: Attach copies of Petroleum Titles]

Annex to Schedule 2

Title Area Map

[Insert, if required]


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Schedule 3Disclosure Materials

Category Document Name

Technical

Financial

Legal

Specific disclosures [Example only]

made by the Farmor to the Farmee in respect of the Farmors warranties under thisagreement

1. Each Petroleum Title in the Farmout Area expires on the dates stated in Schedule2 which expiry may result in termination or surrender of a portion of the area ofthe Petroleum Title.

made by the Farmee to the Farmor in respect of the Farmees warranties under this

agreement:1. [Specify]


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Schedule 4Joint Operating Agreement

[Delete, if i napplicable ].

[ Joint Operating Agreement ]

[the AMPLA Model Petroleum [Exploration] Joint Operating Agreement published onthe AMPLA website at www.ampla.org as at the Agreement Date with the followingamendments:

[specify]

[Other]
http://www.ampla.org/http://www.ampla.org/http://www.ampla.org/


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Schedule 5Deed of Assignment and Assumption


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Signing page

EXECUTED by in accordance with

section 127(1) of the Corporations Act by authority of its directors:

)

)

)

)

)

)

)

)

)

)

))

)

)

............................................................

Signature of director

............................................................

Name of director (block letters)

............................................................

Signature of director/company secretary*

*delete whichever is not applicable

............................................................ Name of director/company secretary*(block letters)

*delete whichever is not applicable

SIGNED, SEALED AND DELIVERED by

as attorney for

............................................................

under power of attorney registered No.in the presence of:

............................................................

Signature of witness

............................................................

Name of witness (block letters)

............................................................

Address of witness

............................................................

Occupation of witness

)

)

)

)

)

)

)

)

)

)

))

)

)

)

)

............................................................

By executing this deed the attorney statesthat the attorney has received no notice ofrevocation of the power of attorney


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Petroleum Title Farmout AgreementDated

Between[ ] (Farmor )

And[ ] (Farmee )